Jobs may land in Stillwater

A "no" vote on a new proposed contract between Mercury Marine and its 580 hourly union workers in Fond du Lac, Wis., would mean the company would look to move its manufacturing operations to Oklahoma.

Or, as Mercury Marine President Mark Schwabero said Thursday in a conference call, "we would be moving jobs out of Fond du Lac to a more competitive location, and the primary location is Stillwater."

A vote on a new contract between Wisconsin-based Mercury and the International Association of Machinists and Aerospace Workers is set for Sunday. Negotiations began last week as Mercury tries to restructure its manufacturing operations affected by the economy and subsequent drop in demand for recreational boats.

"The industry is considerably less than in the past," Schwabero said, and any recovery this time around will take longer than past declines. "We've got excess capacity, and we need to rationalize our operations."

The MerCruiser plant in Stillwater produces sterndrive engines, and Schwabero said the plants share many common operations.

"Our fundamental objective is to get in line with the economy," he said.

Mercury has a contract with the Local 1947 IAM through 2012 but proposed a new seven-year labor agreement with changes in three primary areas: wages, benefits and operational flexibility. Some changes include limiting overtime hours, cutting paid holidays by two days, altering the wage structure for new hires and decreasing job classifications from 58 to 11.

Current employee wages would not be affected through 2012. The company said its proposal includes wages that are competitive for the region and a benefits package similar to that of Mercury's salaried workers.

"We have been extremely open and honest with our employees and their representatives about the challenges that must be overcome if Mercury is to remain in Fond du Lac," Schwabero said.

A "yes" vote on the proposal "will make both of these facilities competitive," he added, and keep the jobs in Fond de Lac intact.

IAM business representative Russell Krings said the union would not comment before the Sunday vote.

If the union doesn't vote to accept the proposal, a decision will be made soon, probably within 30 days, the company said.